Mr. Speaker, I am pleased to rise on behalf of the government to speak to Bill C-574, an act to amend the Department of Public Works and Government Services Act (use of wood).
Let me begin by saying that I appreciate the intent of the bill, which is to strengthen the forestry sector. No one would dispute that seeking to strengthen various economic sectors of our country is a laudable goal. That is precisely why our government is so focused on jobs, economic growth, and prosperity for all sectors and all regions of our country.
That said, however, members who were present for the debate in 2010 on Bill C-429, which was identical to this legislation and which was defeated, will know that there are several reasons that this bill is fundamentally flawed. In fact, there is no evidence to suggest that, even if passed, this legislation would strengthen the Canadian forestry sector it claims to help.
While I could elaborate at length on the problems with this proposed legislation, I will limit my remarks to the key reasons that our government cannot support the bill.
First, the proposed bill contravenes Canada's legal obligation under the procurement provisions within our country's international and domestic trade agreements.
These agreements prohibit discrimination and unnecessary barriers to trade. Any legislation that were to amend the contract tendering requirements to encourage the use of forestry products or to give preference to a supplier who makes it a policy to use them would contravene Canada's trade obligations under NAFTA, the WTO Agreement on Government Procurement and our free trade agreements with Chile and Peru.
This bill does not just contravene international trade agreements. In fact, under the Agreement on Internal Trade, government tender documents cannot require the use of specific materials unless they are needed for technical or operational reasons.
The Agreement on Internal Trade prohibits the introduction of a bias in the form of technological specifications in favour of, or against, particular goods or services, including those goods and services included in construction contracts.
Bill C-574 would also impair the capacity of the Minister of Public Works and Government Services to fulfill her mandate as stipulated in her own legislation, the Department of Public Works and Government Services Act.
By giving preference to the use of wood in the construction and renovation of federal buildings, the bill indirectly promotes one sector over other, also essential, sectors of the Canadian economy. This would, by extension, favour the economies of some regions over others, in direct conflict with the mandate of Public Works and Government Services Canada, which has procurement processes in place to ensure openness, fairness, and transparency in order to obtain best value for the crown.
Let me also note that most PWGSC projects are large office buildings of more than four storeys, and the current national building code does not easily permit the use of combustible materials for the construction of buildings higher than four storeys.
That said, PWGSC already uses a large quantity of wood when fulfilling its responsibility to maintain buildings owned by the federal government and provide office space for public servants. The department spends approximately $160 million a year on office space and furnishings, and approximately 15% of that amount is put towards wood products.
While the Department of Public Works remains an important consumer of wood, our government also recognizes the importance of the forestry industry. It provides, and continues to provide, significant support to the forestry sector.
Given its long-standing importance to our country and to many communities, particularly smaller ones, the forestry sector has received a great deal of government attention in recent years.
Since 2006, our government has supported the forestry sector to the level of $1.8 billion, and it continues to invest in innovative new products, maintaining existing markets and pursuing new markets for Canadian forest products.
To cite some examples, in 2010 the investments in forestry industry transformation program, or IFIT, was created to enable Canadian forest companies to lead the world in developing innovative technologies that improve efficiency, reduce environmental impacts, and create non-traditional, high-value products from Canada's world-class forest resources, and there have been some tremendous successes.
IFIT funding, for example, to the Tolko Industries Ltd. mill in Meadow Lake, Saskatchewan, helped the company develop innovative technology that allowed it to become the first in North America to produce different types of oriented strand board on a single production line.
Under Canada's economic action plan 2014, IFIT was renewed for four more years to the tune of $90.4 million so that it can help support more breakthroughs like this one across the country.
The 2012 and 2013 economic action plans provided the forest innovation program with $197 million over four years. That program helps forestry companies innovate and adopt new technology. For example, the tall wood demonstration project initiative helped increase the export potential for forestry companies in both traditional markets and emerging onces, including China, India and the Middle East.
On the trade side, in 2012, the government announced the extension of the softwood lumber agreement between Canada and the United States through to the end of October 2015. That guaranteed that Canada's softwood lumber producers would have stable access to and fair market value in U.S. markets. That agreement came into effect in October 2006 and meant that more than $5 billion in U.S. tariffs went back into the pockets of Canadian producers.
It is also important to consider the possible unforeseen consequences if the bill were to pass. Greater demand for wood could lead to greater imports of wood products and that would certainly be of no help to the Canadian forest sector.
As I said earlier, the bill poses many legal and procurement issues that make it impossible for our government to support. In fact, in 2010 when the previous version of the bill was being debated, it is interesting to note that both opposition parties could not agree on a unified position when it came to the bill. The votes were split along regional and provincial lines and even many opposition members could see that the bill was fundamentally flawed and did not support it.
Of note, let me quote the current NDP critic for Public Works, the member for Winnipeg North, who during consideration of the previous identical version of the bill at committee said:
We really shouldn't be seized of the issue of what kind of flooring we're going to put into the next public building that we build. It's almost insulting, frankly, for us to be using our time on this. I mean, are we going to have a private members' bill to dictate what kind of curtains we put in the next building we build? I'm starting to get frustrated with this.
While most of the NDP caucus voted against the bill, the current leader of the NDP, the member for Outremont, supported it.
Interestingly enough, the Liberal Party was also deeply divided on this legislation, with the current Liberal Finance and National Revenue critic, the member for Kings—Hants, voting against the bill and the current Liberal leader, the member for Papineau, supporting it.
It will be interesting to see if the current NDP and Liberal leaders will continue to support this flawed legislation, which clearly seeks to unfairly favour one sector over the others and, by extension, seeks to unfairly favour one province and region at the expense of others.
I would like to reiterate that the legislation and its fundamental flaws will not allow our government to support the bill. Today we are seeing Canada's forest sector evolve into a modern, innovative industry with its sights set on new markets, new ways of using wood and new ways to maximize value from forest fibre. Our government is happy and proud to continue playing an important role in supporting these exciting new developments and we do just that because we recognize how important it is to our economy and to our country.